Vapotherm, Inc. (VAPO) stock prices were down by a marginal 1.14% as of the market closing on May 5th, 2021, bringing the price per share down to USD$21.63.
Massive Increases in Revenue
The first quarter of the fiscal year 2021 reported USD32.3 million in net revenue, representing a 69% increase from the same quarter of the prior year. The company also reported total net equipment revenue that was up 123% from the quarter of the previous year, including revenue generated from products and leases.
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Growth During the Pandemic
These significant increases are primarily attributable to the devastating effects of the global Covid-19 pandemic, which affects the respiratory health of infected patients, resulting in increased demand for Precision Flow units. Further contributing to the year-over-year increase, average selling prices of capital and disposables in the U.S. Total disposable revenue increased by 38%. This, in turn, was caused by the increased number of installed bases of Precision Flow units and a surge in demand for VAPO products to treat the respiratory distress in Covid-19 patients around the world.
Improved Gross Margin
Gross profit was reported to be USD$17.2 million for Q1 2021, a USD$8 million increase as compared to Q1 2020. These numbers represent a 53.1% gross margin for Q1 2021, up from 48.2% for Q1 2020. Primarily attributable to the improvement in gross margin is the substantially increases revenue and production volume for the first quarter of the fiscal year 2021 as compared to Q1 2020.
Growth Results in Higher Operating Costs
Q1 2021 saw a 5% increase in its reports of operating expenses in the amount of USD$26.9 million, as compared to the USD$21.9 million reported in the same quarter of the year prior. This increase is primarily attributable to increases in an increased workforce, auditing, and compliance costs resulting in an overall increase in general and administrative costs. Further compounding this effect, research and develop costs were also higher because of the allocation of resources towards the development of HVT 2.0, the company’s next-gen platform.
Solid Liquidity Position
The first quarter of 2021 reported a net loss of USD$10.4 million, down from the USD$13.8 million reported in the comparable quarter of the prior year. These numbers represent a net loss of USD$0.40 per common share in Q1 2021, down from USD$0.66 net loss per common share in Q1 2020. As of March 31st, 2021, VAPO reported having cash and cash equivalents amounting to USD$98.3 million.
Future Outlook for VAPO
With the continued devastation of the Covid-19 pandemic, VAPO finds itself facing massive increases in demand and has the solid liquidity position to leverage its resources to meet that demand. Current and potential investors are hopeful for a continued trajectory of success in the promising numbers reported for the most recent fiscal quarter.
